NRB Issues Reverse Repo of Rs 20 Bn

Aug 06, 2020 11:51 AM Merolagani

Nepal Rastra Bank is issuing reverse repo of Rs 20 billion on Thursday, August 6. The bank is issuing the reverse repo in a bid to mop up excess liquidity in banks and financial institutions (BFIs).

As per NRB, the banking system has above Rs 200 billion liquidity.

The reverse repo will mature in 7 days on August 13. The A, B and C listed BFIs can participate in the auction of the reverse repo.

In order to bid for the reverse repo, NRB has made a master repurchase agreement compulsory for the BFIs. According to NRB, the interest rate of the repo will be set as per the weighted average of interest rate bid by the BFIs. Usually, NRB issues short-term reverse repo to mop up excess liquidity in the banking system.

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